11 cashless challenges: the first cashless store in Eastern Europe

The pet store in Novaja Baravaja (Minsk) has become a real sensation not only for Belarus but for the whole Eastern Europe. This is the first offline store in our region where customers can purchase just using a regular mobile application - without the participation of cashiers and sellers at all.
How it works? Your bank card is linked to the application installed on your mobile device. The QR code scanned with the sensor at the entrance and you can go inside. Same happens when you leave; therefore, your card debited for the goods that you chose. Everything is quite simple and fast. However, turning this store into convenient public selling space was not easy task at all. After all, the cashless stores, starting with Amazon Go, are still not that numerous.
The store format and design were fully developed by NZR – New Zones of Retail company, which works in retail design and marketing sphere for five years. About main challenges during the development tells us Aliaksandra Nazarkina, CEO NZR.

1st Challenge: Ambitions and budget

Major problem that many specialists faces in our region is the project realization coasts. 90% of our clients are people who travel a lot. Naturally, the idea to create a store does not come all of a sudden, but carried for a long time. Therefore, they begin to look for innovative retail stuff around the world: look, I want this cash register for myself, I want that showcase, I like this style, etc.
When the customer comes to u, he fills out the creative brief, sends examples of the stuff he likes. The brief lays the foundation for the first developed concepts, including the description of what the store consists of, what repairs will be needed or what equipment to buy, costs on trade marketing, etc.

And here comes the first problem: the client has an ambition to create a store like that of some world-famous brand, but is only ready to cover the costs of some local provincial market stall…

This wasn’t easy with our client too as we had to find the solution to effectively present such an innovative idea as cashless store with some wow-effect. To attract the attention of the major media and main chain stores (and we achieved this in result).

Biggest part (80%) of the original budget went to IT for application developing. Only a fifth part of the budget remained for the store format, design and implementation remained. Of course, it took a lot of work to find solution for the interior and commercial equipment design to make them cool, unusual, beautiful, and save money. Our love for eco-design philosophy with loft elements, as well as our passion for brutalism in design, helped a lot to find proper approach.
As result we found some great solutions for the interior and equipment design, materials selection, which helped to create a really convenient public space. We received a lot of superb reviews about the store's design, and not only from the customer. “Where did you find such brilliant designers? Everything is so stylish ... are they really from Minsk?" - said Tatstsiana Kauganava, CEO of the cloud technology development company.

2nd Challenge: Sophisticated assortment plan for offline retail

Initially there was an online ZOOQI store, which needed to be converted into offline format. Naturally, its assortment was bigger than the offline one, and our client did not have an assortment plan’s qualitative analysis, as the company had not worked in traditional retail before.
We wanted to encourage good customer experience with the new innovative shop. To expand the assortment of collars, leashes, toys, and vitamins. Nevertheless, we did not get a proper assortment strategy from our customer at all…

3rd Challenge: Pharmaceuticals

The pet good’s market is very competitive. There are three strong online players in Belarus and hundreds of small private traders selling such goods offline. The ZOOQI team understood that the company also needed to deal with zoo pharmaceuticals. A year later, the company was able to sell pharmaceutical products (according to the Belarusian legislation, there is a list of products that cannot be sold without a specialist). Pharmaceuticals in a pet store is a separate sales channel that we aimed to further develop in this store.
This stage has not been finalized yet. Therefore, we would be grateful for good cases in the comments if any of the readers faced similar difficulties.

4th Challenge: Customer's lack of offline retail experience

There were plans to launch the store in two weeks. Which was impossible: usually only the lease agreement procedures take this time in Belarus. Further, the selection of the contractors, estimates, selection of materials...
Good lighting tools are not easy to find on the market in Belarus. So, we had to wait a couple of weeks. Each material had to be confirmed, samples provided...

At the final stage, we faced that our customer did not know how to proper label goods: the stickers were attached to the front side of the package, and even the holes for hanging were blocked with it. A minor thing, but for us as professionals, it was a clear mistake. We found the way to fix it and helped the ZOOQI employees to it quickly.

5th Challenge: Understanding offline marketing

The website always has banners, pictures, popups, bright text, etc. We used similar approach in the interior design with emotional focus areas with animals and doodles.

We counted on the ZOOQI team’s help (for example, they had a web designer). But we quickly realized that web design and trade design were not that closely connected. We spoke different languages, and had to redo all the necessary layouts ourselves.
ZOOQI had a corporate identity and we really wanted to stick to it. In practice, it turned out that there was no proper brand book. We also wanted to keep a single corporate color. In online it is “salmon”, or light pink. But there was no any similar paints or materials in reality. Also, there was shopping center brand book which regulated a lot of stuff related to shop’s exterior and interior, including for example the color of the shop’s sign.

6th Challenge: Market readiness for a new format

Initially, we worked out a retail book with detailed visualization, technologic aspects, listed advantages and marketing issues. It was not easy to find a suitable trading platform. Most shopping centers were not ready to “take risks”: many did not believe in the cashless project.
The new area of Minsk (Novaja Baravaja) with advanced technologies and ergonomics was ideal to become the starting platform for ZOOQI. The area attracts people of creative and innovative professions, so the choice of location for a store of this format was very successful.

7th Challenge: Adaptation of the space for a non-standard format

There were difficulties with the space itself too. Here we encountered general conservatism and inflexibility of the whole Belarusian commercial spaces market of commercial.

Due to adopted technology the store could work day and night, so we did not need doors at all. We asked to remove them as they looked weird with our concept, but the mall refused to dismantle them.
According to fire safety rules, the passage must be at least 110 cm. Due to the fact that the doors could not be removed, we also had to change our entry dimensions. The administration of the shopping center did not agree to replace the lighting, so we had to create new illumination map and put an accent lightening.

8th Challenge: Visual Marketing

It may sound weird for many of our readers across the globe but the Belarusian retail still has not fully recognised the value of the display windows as the sales channel. The mall’s designer (young employee) covered all the display windows with white stickers. In result our project had the only full-fledged display window.

Taking in account space optimisation, we decided not to “hide” the additional technical rooms, which were important for the cashless technology, but to make them part of the display window. In result the shop windows were semi-closed.
The display windows are minimalistic, and I consider them one of the best in all of Minsk. The concept was based on the symbiosis of online and offline store format. Therefore, we used polygonal animals, as geometric shapes were latest trends in design during this time, which provided some clear reference to digital.
There were several companies that sell polygonal templates, but no one wanted to develop something for us really unique. We had to order and deliver them from another country. During transportation, the polygonal animals were damaged, but since there are decorators in our team we promptly restored them.

9th Challenge: Trade equipment manufacturing

Several points here. We think that narrow specialists - retail designers would agree: equipment producers or home interiors designers could not create proper retail space. Some nonspecialized designers could do it very nicely visually, but absolutely not functional retail-wise. Previously, the store interior style lifespan was five years, now it is even less. Designers satisfy their ambitions and don't think about the future shop’s sales.

Another extreme is trade equipment producers. Who usually works as a designer at such enterprises, at last in Belarus? Recent students who had mastered a graphic editor. There are, of course, exceptions, but none of them usually have ever been involved in sales, have ever stood behind the checkout, knew what a store's break-even point or customer flow is, and had a very remote idea of merchandising in general.

And the third extreme. Never hire a furniture manufacturer who produce everything: kitchens, tables, cabinets, and “also can do for shop”. We had to work with an ordinary furniture wardrobe producer, and had to explain basic things: that we need shopping baskets, that we need a special equipment for the pet belts (which has not yet been delivered), that all (absolutely all) shelves must be regulated... In terms of functionality, we gave the owner clear recommendations for additional ordering of the additional points of sale.

The store looks nice and functional in result, but the color and quality of the material leaves much to be desired unfortunately.

10th Challenge: First things first

Software or store format? The idea laid on the surface, and we got this project to create the store. Not as simple designers, but as retail design specialists. And we are really grateful to our customer for this opportunity. But there was a big problem when we faced that the biggest part of the planned budget, time, and resources were spent on developing the software, not the store format. Therefore, every time we had to prove that, for example, display windows were necessary, visual merchandising was “must have”, etc.

11th Challenge: Merchandising

At the final stage, we found that the customer had already had a person on the staff who “is engaged in offline, he will do merchandising part himself". But when we saw the results with the cats toilets and huge pet houses on the most valuable places blocked the entire view of the store, no emotional places for spontaneous purchases, etc. The problem had to be solved quickly, since the next day was official store opening, with the journalists invited… We arrived with the merchandiser and rearranged everything ourselves according to the basic rules.
In general, the project turned out to be very interesting for NZR team, and all the challenges we met and solutions we found helped us gain very valuable experience in developing completely new store format.